A Case Study on Digital Competence in the Norwegian Banking Sector

(1)

Master of Information Systems – Digital Business Systems

A Case Study on Digital Competence in the Norwegian Banking Sector

Julie Norveel (705747)

A report submitted in partial fulfillment of the requirement for the degree of Master of Information Systems – Digital Business Systems

Supervisor: Wanda Presthus

Restricted: c Yes c No

Kristiania University College Prinsensgate 7-9 0107 Oslo Norway

(2)

Abstract

Innovation starts with people, making humans an integral part of an organizations growth and development. While this 21^st-century is crowded with disruptive technologies and ground- breaking innovations, this master thesis will take a step back and consider the main building block that is fundamental across new discoveries: basic digital competence. The purpose of this master thesis is to explore digital competence in the Norwegian Banking Sector, and the underlying factors that determine the level of competence amongst employees. This will be discovered through a single case study where data is derived from iterative testing of 213 employees in the banking sector provided by Norsk Test, as well as semi-structured interviews with tested employees and research participants. The thesis draws on the concepts of

information infrastructure (Hanseth and Lyytinen, 2010) and knowledge management (Davenport and Prusak, 1998) as theoretical lens for analysis.

Accurate measures of digital competence amongst employees is scarce in current literature.

This study contributes to literature by addressing the research gap of digital competence amongst employees, and propose a definition of how digital competence can be defined in the Norwegian Banking Sector. The thesis follows the event where 213 employees endures from a low level, to a significantly increased level of competence. Findings proved that tasks, role, background and organizational culture influences an employees´ level of competence, which evolves in a discussion about perceived value and relevance of underlying concepts of the topic.

Keywords: Digital Competence, Case Study, Norwegian Banking Sector, Knowledge Infrastructure in Action

(3)

Acknowledgements

The process of this master thesis has been a substantial puzzle with multiple pieces that in the end constructed this master thesis. While some pieces were effortless to place, other proved to be demanding and time-consuming to position. Comprehensive support from multiple sources allowed this master thesis to become the complete picture, and I would like to acknowledge the people that have supported and helped me throughout this process.

I want to thank my supervisor, Associate Professor Wanda Presthus. Thank you for endless encouragement, always answering my questions, and being a consistent advisor during the master thesis and beyond. I am very grateful for the time and learning process you have extended over the past year.

Thank you, Bernt and Sven Inge, for disclosing the work of Norsk Test and your undivided support. The invitation and visit to your office in Kirkenes will always be a unique experience of this master thesis process, and I look forward to staying in touch. You have been an

essential piece in this puzzle and I am very thankful. Furthermore, I am very grateful for the participants and case company that allowed me to share their journey through the Norsk Test project.

Jacob, thank you for the support and patience during the most intense months of the master thesis – we survived the past months in our 43 square meter apartment! Thank you Janne, Kjersti, Berit and Helene for two great years at Kristiania University College. Lastly, thank you mom and dad, you have both been a ray of sunshine during this period.

I certify that the work presented in the thesis is my own unless referenced.

Signature:

Date: 08.06.2020

Total number of words: 19 596

(4)

List of Tables

Table 1: Overview of Master Thesis structure ... 12

Table 2: Literature Retrieved from ´The Basket of Eight´. ... 13

Table 3: Literature Retrieved from Google Scholar ... 14

Table 4: Overview of Main Streams of Literature ... 14

Table 5: Overview of Retrieved Frameworks ... 15

Table 6: Terminology used in studies of Digital Competence (Ilomaki, Kantosalo & Lakkala, 2011; van Laar et al., 2017) ... 16

Table 7: Summary of main findings from the Literature Review ... 26

Table 8: Case Study Criteria (Yin, 2014) ... 28

Table 9: Summary of Data Collection ... 31

Table 10: Overview of levels of analysis from multiple perspectives ... 36

Table 11: Concept Frequency by Academic Literature and Applications by Norsk Test ... 38

Table 12: Overview of Norsk Test composition and underlying concepts (Datakortet, 2007) . 39 Table 13: Participants Definition of Digital Competence ... 41

Table 14: Perceived benefits of Digital Competence and Perceived effects of Absence ... 42

Table 15: Overview of connection between attitudes and perceived value of testing ... 43

Table 16: Overview of participants solution to a problem and perceived value ... 44

Table 17: Description of main events in the project "Mapping Basic Digital Competence" ... 46

Table 18: Master Thesis Project Plan ... 67

Table 19: Framework analysis by underlying concepts ... 68

Table 20: Field Notes, Norsk Test ... 71

Table 21: Field Notes, Case Companies ... 72

Table 22: Interview Guide ... 73

Table 23: Interview Themes and Codes ... 92

(7)

List of Figures

Figure 1: Style Composition of the Master Thesis. Adapted from Munkvold and Presthus

(2016) ... 11

Figure 2: The Case Study process based on Yin´s guidelines (2014) ... 11

Figure 3: Research Fields of Digital Competence (Ilomaki, Kantosalo & Lakkala, 2011; van Laar et al., 2017) ... 16

Figure 4: Summary of “Composition of knowledge, skills and attitude items for digital competence” (Ala-Mutka, 2011, p. 47) ... 18

Figure 5: Summary of digital competence framing by van Laar et al (2017) ... 18

Figure 6: Summary of Oberländer et al. (2020) digital competence framing ... 18

Figure 7: Individual digital competence: A Multi-Area Conceptualization (Vieru et al., 2015, p. 4683) ... 20

Figure 8: Summary of stages of ´digital literacy´ (Ala-Mutka, 2011, p. 46) ... 22

Figure 9: Organizational learning: From Experience to knowledge (Argote and Miron-Spektor, 2011) ... 23

Figure 10: : ´Organizational Learning as a Dynamical Process´ (Crossan et al., 1999) ... 23

Figure 11: Motivational factors to improve an individual’s level of Digital Competence (Lloyds Bank, 2018, p. 25) ... 25

Figure 12: Boundary and Focus of my case study (Miles & Huberman, 1994, p. 25) ... 29

Figure 13: Knowledge infrastructure in action (Presthus, 2013, p.148) ... 30

Figure 14: Guidelines for qualitative research interviews (Myers and Newman, 2007, p.16) .. 33

Figure 15: Ladder of analytical abstraction, from Carney (1990), cited by Miles and Huberman (1994). Reproduced by Presthus, 2015. ... 35

Figure 16: My finding on Concept Frequency based on Framework-Analysis ... 37

Figure 17: Overview of results from test 1 and test 2 by topic (Norsk Test, 2019). ... 39

Figure 18: Individual results from Test 1 and Test 2 (Norsk Test, 2019). ... 40

Figure 19: The knowledge infrastructure in action post Test 1 ... 47

Figure 20: The knowledge infrastructure in action post “Mapping of Basic Digital Competence” ... 48

Figure 21: My observation of the outcome of neglecting digital competence concepts. ... 52

(8)

Chapter 1: Introduction

This chapter provides a brief introduction to the topic digital competence, and presents the motivation and background for the study. The unit of analysis will be introduced, boundary of thesis, followed by the master thesis outline.

“Technological developments, including the field of artificial intelligence, cause changes in many professions: Some tasks will fall through, and tasks that require other types of competence becomes relevant. Concurrently, fewer jobs will require limited or no formal

digital competence.” (Astrup, 2020).

The former digitalization minister launched a National Strategy for Artificial Intelligence (AI) in January 2020 with the intent to prepare the Norwegian citizens, public and private

organization for the efforts needed in order to stay competitive as a nation, and withhold the welfare system known today. Rather than being an incentive for jobs and income, as during the Industrial age, technological development will derive the contrary (Leonhard, 2016), as 33% of all jobs in Norway is predicted to diminish to automation (Ministry of Municipalities and Modernization, 2020). The topic of digital competence is therefore at the forefront of citizens ability to contribute and take part in today´s society (Harari, 2018).

Digital competence was a prominent topic during the late 1990s and early 2000s. The early streams of literature revolved around the specific roles that information communication technologies (ICTs) were compatible for, mainly IT specialists and librarians (Bawden, 2008).

The topic became mainstream as ICTs became a fundamental part of organizational processes, and today, digital competence is considered both a right and requirement for an individual´s ability to contribute to the knowledge society (Ananiadou & Claro, 2009; Ferrari, 2012). While the topic drove streams of literature in various directions, the focus on digital competence amongst employees decreased (van Laar et al., 2017).

Norwegian Statistics discovered hidden organizational costs caused by absent digital competence amongst employees; lack of competence across the Norwegian workforce was estimated to be 16.2 billion NOK in 1996. Five years later, the estimate had increased to 33.6 billion NOK (Cap Gemini & EY, 2001). Nevertheless, a comprehensive survey verified that 30% of individuals increase their digital competence to improve performance at work (Lloyds Bank, 2018). Oberländer et al (2020) argue that current literature on the topic of digital competence in an organizational context is narrow. Moreover, it is important to accommodate the streams of literature in Information Systems (IS) research, as; “employees have to engage in lifelong learning, and acquire new competencies to adapt to the constantly increasing demand of the fast-changing work environment” (Oberländer et al., 2020, p. 2).

(9)

1.1 Research Aim and Objectives

The majority of current literature that contemplate digital competence as a key concept considers the path of teaching, education and pedagogy (van Laar et al., 2017; Ferrari et al., 2013; Kispeter, 2018), and there is a gap in our understanding of how digital competence endures in the organizational context (Oberländer et al., 2020). Amongst the limited scope of literature on the topic, there is a significant emphasis on discovering theoretical compositions of digital competence frameworks, then again the frameworks underlying concepts. There is limited empirical application of these frameworks, and the existing findings utilize self- assessment methods (Ferrari et al., 2013; Khan & Vuopala, 2019), which is highly criticized for generating inaccurate results due to the likelihood of overestimating personal abilities (van Laar et al., 2018; Norsk Test, 2020). Current literature calls for research that presents accurate results of employees´ level of digital competence (van Laar et al., 2018; Oberländer et al., 2020). Furthermore, researchers rarely consider the underlying factors that drives a particular level of digital competence in an organization.

The aim of this master thesis is to address the topic digital competence in the Norwegian Banking Sector, and contribute to the limited research by exploring digital competence within this unit of analysis. Following, the thesis will undertake the ´knowledge infrastructure in action´ framework to discover the underlying factors that determine a particular level of digital competence in an organization. The following research questions will be answered:

(1) How does the Norwegian Banking Sector define digital competence?

(2) What are the underlying factors that determine the level of digital competence amongst employees?

The following objectives will be completed in order to answer the research questions:

• A comprehensive search for relevant literature with digital competence as the key topic with focus on the organizational context.

• A literature review will generate a thorough understanding of current and undiscovered research.

• Conduct a framework-analysis to discover the frequency of mentioned underlying concepts of digital competence.

• Review and analyze Norsk Test findings and address the theoretical framework compared to the findings from the literature review.

• Conduct semi-structured interviews with participants, observation of Norsk Test and expert interviews.

• Conduct qualitative analysis.

• Write the master thesis.

Appendix 9.2 provides further insight into how the master thesis was conducted.

(10)

1.2 Research Approach

A case study was chosen as the research method for this master thesis. The study presents a short-term contemporary study of a single case company in the Norwegian Banking Sector.

Norsk Test initiated the research process by providing empirical findings of 213 employees´

individual level of basic digital competence, which is used as secondary data. The empirical data is derived from semi-structured interviews with seven employees that have been tested by Norsk Test. Field trips and expert interviews were conducted. Presthus (2015)

reproduction of Miles and Huberman´s ladder of analytical abstraction was used to analyze findings, and the theoretical framework ´knowledge infrastructure in action´ is applied as the lens for analysis. Chapter 3 provides an in-depth understanding of the research approach.

1.3 Unit of Analysis

The single case study composes of two main actors, the case company and Norsk Test (the company behind the testing). The case company initiated mandatory testing of basic digital competence amongst 213 employees´, and Norsk Test was acquired to construct, deliver and present the result. Norsk Test was previously known as Datakortet, and withholds over 20 years of experience with testing digital competence. Each employee was tested two times with multiple-choice questions within five main categories: (1) basic use of a computer, (2) word processing, (3) internet, (4) email and (5) spreadsheets. If an employee’s results after test 1 was particularly low, they received customized training. Test 2 was conducted after some time in order to get an overview of potential development.

My supervisor introduced me to the CEO of Norsk Test in December 2019. This particular case company was chosen based on the already existing results of digital competence. A management team at the case company allowed me to conduct further investigations on the outcome and contact employees for further analysis. The case company and participants wish to be anonymous.

1.4 Master Thesis Outline and Boundary

Figure 1 presents how the research of this case study is framed. The figure is adopted from Presthus and Munkvold (2016), which guides junior researchers to frame their research contribution(s).

(11)

In order to reach these goals, the various processes of the master thesis were divided into sections, following Yins guidelines (figure 2).

Need for a greater understanding and accurate measures of digital competence amongst employees (van Laar et al, 2017)

Knowledge infrastructure in action (Presthus, 2013)

How does the Norwegian Banking Sector define digital competence?

What are the underlying factors that determine the level of digital competence amongst employees?

Norwegian National Strategy of AI. Addressing the lack of Digital Competence amongst employees

Qualitative case study to answer the research questions

Lessons learned. Insight into the underlying factors that may drive a low level of digital competence amongst employees. Overview of relevant underlying concepts Contributing by exploring digital competence amongst employees, in the Norwegian Banking Sector. An explanatory model of underlying factors of digital competence.

Main data collected from semi- structured interviews, secondary data, observation and research participants.

Figure 1: Style Composition of the Master Thesis. Adapted from Munkvold and Presthus (2016)

Figure 2: The Case Study process based on Yin´s guidelines (2014)

(12)

The following Table 1 provides an overview of how the master thesis is structured:

Chapter Description of chapter

Chapter 1 Introduction to research and presentation of aim, objectives and research questions. Short introduction to research approach, the case and master thesis outline.

Chapter 2 The Literature Review starts by establishing the process of gathering literature. Following, a presentation of current research on the topic of digital competence with relation to an organizational context.

Frameworks for measuring digital competence and underlying factors that may influence the employees level of digital competence.

Chapter 3 The Method describes the case study methodology and steps of the research process towards answering the research questions. The theoretical lens of analysis will be introduced.

Chapter 4 Findings will present the data retrieved, and the outcomes of analysis. The findings will be applied to the theoretical framework

´knowledge infrastructure in action´.

Chapter 5 The Discussion will analyze the findings from both literature review and the data analysis. The research questions will be discussed from different perspectives based on the theoretical lens.

Chapter 6 The Contribution and Limitations to research will present the master thesis contribution, the limitations and further research.

Chapter 7 The Conclusion will answer the research questions and conclude the master thesis.

Table 1: Overview of Master Thesis structure

(13)

Chapter 2: Literature Review

This chapter presents various streams of literature, including frameworks, findings and gaps, that are relevant for the master thesis and contribute to answering the research questions. This chapter is divided into three sections, (1) the method for gathering literature, (2) composition of digital competence frameworks, (3) digital competence in the organizational context. The aim of this literature review is to gain an overview of the various digital competence

frameworks and the underlying concepts they withhold, and how they are applied in literature.

Furthermore, an overview of current literature that consider organizational learning processes will be presented.

2.1 Search for Literature

The search for literature was conducted in two stages (table 2-3), first determining the existing literature with digital competence as key concept amongst publications from the Basket of Eight. During the early phases of searching, various use of terminology was

identified when applying digital competence to research, which drove the need to identify the origins of the terminology and how they differ. After mapping the appropriate use of

terminology, articles were retrieved with either the term: digital competence, 21^st-century digital skills, digital skills or digital literacy, as they are used as ´umbrella terms´ rather than specific for a particular context. Each article retrieved had to contain one of these terms as a key concept, mentioned in its abstract, title or as a keyword. After scanning the Basket of Eight journals, further searches were made in Google Scholar. Another discovery was the majority focus on education, teaching and pedagogy as the main focus. These articles were not included due to the discipline of this research, and the relevance to this case study.

Articles that were retrieved had to consider an organizational context. The following tables (2, 3, 4, 5) provides an overview of retrieved literature from different sources, various streams of literature and the frameworks that were retrieved.

Stage 1: Basket of Eight

Basket of Eight Articles with “Digital

Competence” as Key Concept

European Journal of Information Systems

Information Systems Journal 1

Information Systems Research 2

Journal of the Association of Information Systems 1

Journal of Information Technology

Journal of Management Information Systems 1

Journal of Strategic Information Systems

Management Information Systems Quarterly 1

Total 6

Table 2: Literature Retrieved from ´The Basket of Eight´.

(14)

Stage 2: Retrieved from Google Scholar

The amount of literature that considers the topic of digital competence is broad, however there are limited studies that consider the organizational context. A total of 2256 articles were identified, where the majority is devoted to unrelated fields of study, for this thesis. An extensive screening process, by source, abstracts and citations left 44 articles included.

Google Scholar Total

Number of articles with digital competence as key concept

2256 Number of main articles retrieved 44

Table 3: Literature Retrieved from Google Scholar

Stage 3: Mapping streams of Literature

The retrieved literature can be divided into three main streams regarding the aspect of digital competence the particular article considers, hence some of the themes overlap.

Themes Presented in the Literature Number Article per Theme Frameworks and conceptualizations of digital

competence

20 Organizational influences on individual level of

digital competence

18 Employee level of digital competence 10

Table 4: Overview of Main Streams of Literature

Stage 4: Retrieved Frameworks

In order to get an in-depth understanding of digital competence as a concept, a framework- analysis was conducted. A broad focus of framing different concepts of digital competence was recognized, with contrasting input from different sources. The following frameworks were retrieved based on their citations, source and relevance for the master thesis. The frameworks are retrieved from multiple sources, and there is a lack of frameworks in IS research.

(15)

Author & Year Source Type Ferrari, 2012 Joint Research Centre of the European

Commission (2012)

Government Kispeter, 2018 Digital Skills and Inclusion Research

Working Group

Academic Ferrari, Punie & Redecker, 2012 European Conference on Technology

Enhanced Learning (2012)

Government Van Dijk & van Deursen, 2014 Computers in Human Behaviour Academic Van Laar et al., 2017 Computers in Human Behaviour Academic Ferrari, 2013 Joint Research Centre of the European

Commission (2013

Government Ala-Mutka, 2011 Institute for Prospective Technological

Studies

Government Van Laar et al., 2018 Telematics and Informatics Academic Bawden, 2011 New Literacies and Digital Epistemologies Academic Carretero, Vuorikari & Punie,

2017

Publications Office of the European Union Government Vieru, Bourdeau & Bernier et

al., 2015

2015 48th Hawaii International Conference on System Sciences

Academic Van Deursen, 2010 International Journal of Human- Computer

Interaction

Academic Table 5: Overview of Retrieved Frameworks

2.2 Research Fields, Terminology and Definitions

Digital competence knows many terms (table 6), definitions and frameworks (table 5) (Kispeter, 2018). Gilster coined the concept digital literacy, primarily relevant for library studies at the early stages of deployment (Bawden, 2008). When the use of technology became a mainstream part of people’s lives, the concept was proportionately relevant within multiple research fields. Ilomaki, Kantosalo and Lakkala (2011) presents an overview of the significant use of digital competence as a topic in various study fields, an overview that was updated by a more recent published literature review by van Laar et al. (2017). Figure 3 provides an overview of the various fields, where the orange circle marks this master thesis focus.

(16)

Equivalent to the broad application of digital competence, the terminology differs. The literature review by van Laar et al (2017) identify various terms that are used in relevant research. Digital competence can be considered to be an umbrella term that covers multiple aspects of its use (Ilomaki, Kantosalo & Lakkala, 2011), where many of the terms presented in Table 6 scopes the definition of digital competence to a specific context. Digital

competence is a broader term and diverse concept, in contrast to digital literacy (Ilomaki, Kantosalo & Lakkala, 2011). This master thesis will use the term digital competence to describe the phenomenon.

Terms Number used in this study

Digital competence 17

21^st-century digital skills 3

21^st-century competence 1

21^st-century ICT skills

ICT skills 1

Technology skills

Information skills 2

Media literacy Information literacy

Digital literacy 7

Digital skills 9

IT Capability 3

E-skills

Computer literacy

Total 43

Table 6: Terminology used in studies of Digital Competence (Ilomaki, Kantosalo & Lakkala, 2011; van Laar et al., 2017)

Figure 3: Research Fields of Digital Competence (Ilomaki, Kantosalo & Lakkala, 2011; van Laar et al., 2017)

(17)

Similar to the various research fields and use of terminology, the definition of digital

competence lacks consistency (Bassellier, Reich & Banbasat, 2011; Oberländer et al., 2020).

The most commonly cited definition in organizational context is by Vieru et al (2015, p.

4683), which reflect the authors´ composed framework for digital competence;

“Digital competence is an individual capacity to use and combine one’s knowledge (i.e., know-what), skill (i.e. know-how), and attitude (i.e. know-why) associated with three related competence areas, technological, cognitive and social, to use new or existing ICT to analyze, select and critically evaluate information in order to

investigate and solve work- related problems and develop a collaborative knowledge base while engaging in organizational practices within a specific organizational context.” Vieru et al (2015, p. 4683).

The definitions do vary across the retrieved literature, and like Vieru et al (2015), the authors tend to define digital competence based on the scope and concepts of the framework. Some common denominators across the definitions do exist; three underlying learning domains;

knowledge, skills and attitudes (Vieru et al., 2015; Bassellier, Horner & Benbasat, 2001;

Ferrari, 2013; Harison & Boonsra, 2009; van Laar et al., 2017), coupled with

conceptualizations and operational components illustrating ways of thinking and working (Ala-Mutka, 2011; van Laar et al., 2017).

2.3 Digital Competence Frameworks

The following section provides on an overview of literature that have contributed to

constructing digital competence frameworks. The review illustrates how existing frameworks vary with the authors choice of organizing, included conceptualizations, and operational components. 12 frameworks are retrieved, and Appendix 9.3 provides a matrix with an overview of frameworks and underlying concepts.

2.3.1 Framing Concepts of Digital Competence

Current authors that propose digital competence frameworks tend to organize the underlying concepts into different building blocks, components or frames. Even though an underlying concept may be constant across various frameworks, the particular concept is ´framed´

differently (van Laar et al., 2017; Oberländer et al, 2020). Both Ala-Mutka (2011) and Ferrari et al (2012) propose frameworks on behalf of the European Commission aimed towards a general understanding of digital competence amongst citizens. Even though, most of the concept included in the two frameworks are similar, Ferrari et al (2012) choose to list fixed concepts with fluent operational components that illustrate an increased level of digital competence. On the other hand, Ala-Mutka (2011) makes a distinction between ínstrumental skills and knowledge´, ádvanced skills and knowledge´ and áttitude for skills and

knowledge application´, when framing the digital competence concepts (figure 4).

(18)

The majority of authors choose the same organizing logic of underlying concepts as Ferrari et al (2012), without any particular framing (Carretero, Vuorikari & Punie; 2017; Vieru et al., 2015; Ferrari, 2013). The authors use dimensions for each concept, illustrating a growing competence from a particularly low point to a more specialized competence level. Van Deursen (2010) separates the concepts based on the increased complexity in a hierarchical structure, assuming that one concept will lead to another (Ala-Mutka, 2011). Van Laar et al (2017) chose a similar organizing logic as Ala-Mutka (2011), however merge ´instrumental-´

and ´advanced skills and knowledge´ to 21^st-century core digital skills and ´attitudes´ reflects similar concepts as 21^st-century contextual skills (figure 5). “Contextual skills are those skills that are required to take advantage of the core skills and, therefore, must be connected to such core skills” (van Laar et al., 2017, p. 582). The framework proposed by van Laar et al (2017) is the first framework aimed towards an organizational context.

A recently published framework aimed towards the organizational context was presented by Oberländer et al in 2020. The authors argue that there is a need for separating concepts into basic and specified DC. “Basic DC (digital competence) are needed at most office workplaces to accomplish everyday tasks. Examples are writing e-mails, using text processing programs or conducting internet research” (Oberläder et al., 2020, p. 8). The authors argue that specified digital competence is aimed at particular tasks or specialized roles in an organization.

2.3.2 Underlying Concepts of Digital Competence Frameworks

Figure 4: Summary of “Composition of knowledge, skills and attitude items for digital competence” (Ala- Mutka, 2011, p. 47)

Figure 5: Summary of digital competence framing by van Laar et al (2017)

Figure 6: Summary of Oberländer et al. (2020) digital competence framing

(19)

The frameworks are constructed by a set of underlying concepts that presents various categories of digital competence (van Laar et al., 2017). “In today´s organisations and politics, there is a growing awareness of the gap between existing and needed digital competences of the workforce to master the challenges of the digitalised future at work”

(Oberländer et al., 2020, p. 1). The initial digital competence frameworks were developed in the 1990s and reflect what we today define as technical concepts. “Technological skills could include, for example, the ability to use a common software tool or specialised tool supporting business tasks (...)” (Vieru et al, 2015, p. 4683). Bruce (1994), Shaprio and Hughes (1996) and Gilster (1997) are only some of the authors that emphasized the importance of developing technical competence, which were referred to as tool literacy. Over time this concept of digital competence simply represents a small part of the frameworks, and are (if mentioned) a part of what is considered core (van Laar et al, 2017) or instrumental (Ala-Mutka, 2011) concepts. An employee has to obtain the ability to use the digital tool at the level of navigation and ability to turn on and turn off (Vieru et al., 2015; van Laar et al., 2017; Ala- Mutka, 2011). Current literature argues different points of view when it comes to an employees´ need to obtain the technical competence. While van Deursen and Mossberger (2018) argue that as technology such as IoT will decrease the need for such skills, others believe an individual who obtain a certain level of competence within the concept will be able to build of further competence, such as other 21^st-century core digital skills (Ala-Mutka, 2011; van Laar et al; 2017, 2018).

While the majority of the frameworks vary in included concepts (Oberländer et al., 2020), a literature review by van Laar et al (2017) found that information management is the most frequently mentioned concept. Information management is; “the skills to use ICT to efficiently search, select, organize information to make informed decisions about the most suitable sources of information for a given task” (van Laar et al., 2017, p. 583). Ferrari (2012) conducted an analysis of current frameworks on digital competence that was applied in specific settings targeting specific age groups. The authors conclude that the underlying concepts are; information management, collaboration, communication and sharing, creation of content and knowledge, ethics and responsibility, evaluation and problem solving and technical operations (Ferrari, 2012, p. 89). Based on these findings, the European

Commission proposed the DIGCOMP framework for developing and understanding digital competence across Europe (Ferrari, 2013). The proposed umbrella framework outlines five concepts, including; ´information, communication, content-creation, safety, and problem- solving´ skills (Ferrari, 2013). The DIGCOMP framework was further extended by Carretero, Vuorikari and Punie (2017) with the DigComp 2.1 framework, including the same concepts, suggesting that even though there is an increased use and developed technologies, the dimensions of digital competence remains the same.

The different versions of the DIGCOMP frameworks are repeatedly used as a substructure to compose other frameworks (Oberländer et al., 2020). Van Laar et al (2017) does however suggest that there is an increasing focus on underlying concepts that does not necessarily have direct relationship with ICTs, as they are concepts necessary for the digital society we live in

(20)

collaboration (amongst others), the more recently added concept competencies include;

ethical awareness, cultural awareness, flexibility, self-direction and lifelong learning (van Laar et al., 2017). Recently, Kispeter (2018) developed a framework based on a case study including three different companies in different sectors. The author concludes with seven components of DC aimed at the working professionals. Kispeter (2018) extended the DigComp 2.1 framework with a comprehensive focus on safety, such as digital rights and digital identity, however advocates for the limited need for technical skills.

Vieru et al (2015) found that the concepts of digital competence can be integrate into three intersecting competence areas, social, technological and cognitive, built up by three domains knowledge, skills, and attitude (figure 7). This particular theoretical conceptualization illustrates how the underlying concepts interact, and the importance of an organization to withhold employees that covers all of the conceptualizations.

Davenport and Pruska (1998, p. 12) suggest that; “the need to make the most of

organizational knowledge, to get as much value as possible from it, is greater now than in the past”. While the chapter has identified various conceptualizations of competence and

underlying concepts, it is still unknown how digital competence is utilized as organizational knowledge and the value of particular levels of competence.

Figure 7: Individual digital competence: A Multi-Area Conceptualization (Vieru et al., 2015, p. 4683)

(21)

2.4 Organizational Digital Competence

The literature proves to pay much attention to framing and conceptualizing digital

competence, however there is limited research that considers how these frameworks apply to an organizational context (Bassellier, Reich & Benbasat, 2001; van Laar et al, 2017). Since Bassellier, Reich and Benbasat (2001) recognized the significant gaps in management and IS research that considered the employee perspective in 2001, there is still a call for a realistic view of employees level of digital competence (Oberländer et al., 2020). While such

empirical evidence is conspicuous by its absence, the literature provides insight into external factors that may influence an employee’s level of digital competence.

2.4.1 The Digital Divide

When the 2020 World Economic Forum took place in Davos, one inclination of disruptive technology was extensively discussed; humans need to, at a greater extent than earlier, see continuous development of competence in order to stay relevant (Harari, 2018). The

discussion was based around the concept of automation, both eliminating and creating jobs for employment, however it is debatable whether people´s level of skills will develop

simultaneously with emerging technologies. Harari (2018) is one of many that argues for a greater digital divide caused by disruptive technologies (Ferrari, 2013; Murawski & Bick, 2017) then again, digital competence is often considered in the same discussions.

The discussion of digital divide is vastly considered by both academics and politicians (Wang, Myers and Sundaram, 2013), where emphasis on digital competence is often just an

underlying discussion. Ferrari (2013, p. 7) argues that with regards to issues of digital divide;

“it is in fact recognized that participation in the digital domain is no longer a question of

´have´ and ´have not´, but rather an issue of competence”. Riggins and Dewan (2005) are one of many that have discussed the concept of digital divide, and argue that; “while some factors affecting the digital divide may be beyond the control of the individual, others are related to personal choices, such as when one has an aversion to technology, and so chooses (...) not to make use of such technologies” (Riggins & Dewan, 2005, p. 303). Findings prove the

inevitable, that more jobs require the ability to use ICTs, then again poses a certain level of digital competence. Furthermore, Riggins and Dewan (2005) compose a summary of studies on the digital divide at organizational level, providing an overview of the variables which influence an organizations´ level of competence; the firm size, the top managements initiatives and the geographic location of the firm. Wang, Myers and Sundaram (2013) suggest that even though that the gap is closing when considering the physical access to digital tools, the levels of digital competence persist, hence widened. The empirical study revolved around the difference between digital natives and digital immigrants, and found that there is no significant difference between their level of digital fluency, with exception to one underlying concept, content creation. The authors construct a conceptual model for digital fluency, where demographic characteristics, organizational factors, physiological factors and social influence all influence one’s ability to use technology, then again their level of digital

(22)

2.4.2 Organizational influence on Digital Competence

Sambamurthy and Zmud (2000) identify the concept of ´organizing logic´, which is defined as; “the managerial rational for designing and evolving specific organizational arrangements in response to an enterprises environmental and strategic imperatives” (Sambamurthy &

Zmud, 2000, p. 107). A particular organizations´ external environment will drive the need for such organizing logic in order to stay competitive, and Davenport and Pruska (1998) suggest

´sustainable competitive advantage´ is derived from the internal knowledge of the

organization. While a tangible asset will decrease in value with increased use, knowledge is sustainable based on the development of new ideas and shared knowledge. Digital

competence aligns with this theory, as Harison and Boonstra (2009) argue that the level of digital competence in an organization will depend of the existing incentive to manage organizational change (Vieru et al., 2015). Figure 8 illustrates the dynamics of digital competence as a main building block for digital transformation, hence a transformation process will depend on increased or new competence at Level I (figure 8) (Hanseth, 2004).

An organizations´ response to the external environment will therefore generate a process that influences the knowledge or digital competence for employees (Roberts, Galluch and Dinger et al., 2012). Nonaka and Takeuchi (1995) extend the view of knowledge creation and argue that; “knowledge creation leads to continuous innovation, which again leads to competitive advantage” (Presthus, 2013, p. 146).

While figure 8 presents one incentive to increase employees´ digital competence, the current streams of literature tends to take the managerial perspective (Oberländer et al., 2020), often with training as a focal point for discussion (Sambamurthy & Zmud, 2000). Gallivan, Spitler and Koufaris (2005) consider the social and cultural norms at the workplace with regards to an individual’s use of IT and perceived usefulness of training. The authors found that while training of an individual has limited effect if the person do not acknowledge the usefulness, an interesting additional point was made: the perceived usefulness of the training itself depends to a great extent on the individuals co-workers opinions of the training. Similarly, Cerezo- Narváez et al (2017) found that while training of individuals is fundamental for responding to change in the external environment, the individual must be prepared for life-long learning,

Figure 8: Summary of stages of ´digital literacy´ (Ala-Mutka, 2011, p. 46)

(23)

during the working career. Argote and Miron-Spektor (2011) propose a model that illustrates the transformation from experience to knowledge (figure 9). “(..) the figure aims to depict an ongoing cycle through which task performance experience is covered into knowledge that in turn changes the organization´s context and affects future experience” (p. 1124).

Figure 9 identifies the relationship between experience and knowledge in organizational learning, then again its implication on employees level of digital competence. Crossan et al (1999) propose the model ´organisational learning as a dynamic process´, which take a closer look at the learning processes in organizations (figure 10). The model suggests that an

organizational incentive to change, in terms of implementing technology, endures from the top-down feedback on application. When applied, the employees comprehension will ´feed- forward´ this experience bottom-up (Cossan et al., 1999). From the employee perspective, this model presents an overview of the managerial influence on employee learning process.

Knowledge is derived based on organizational decisions, while the individual will grasp this knowledge towards competence that will feed forward to organizational processes.

Figure 9: Organizational learning: From Experience to knowledge (Argote and Miron-Spektor, 2011)

Figure 10: : ´Organizational Learning as a Dynamical Process´ (Crossan et al., 1999)

(24)

While the axes of the model expresses the dynamics of information processing, the boxes can illustrate the evolving infrastructure of an organization. Hanseth and Monterio (1997)

presented the concept of information infrastructure which is defined as; “(...) a shared, open (and unbounded), heterogeneous and evolving socio-technical system consisting of a set of IT capabilities and their user, operations and design communities” (Hanseth & Lyytinen, 2010, p. 4). As the single system will be a part of an interconnected system, a researcher should look at the growth of a socio-technical network over time. Hanseth and Monterio (1997) argue that; “a socio-technical network consists of technology as well as the users, developers, and the work practices” (Presthus, 2013, p. 146). Hanseth and Monteiro (1997) suggest that research should shift from focusing on a single system implementation, towards the network of the organization.

Hanseth (2004) built on the theory of information infrastructure and introduced the concept of

´knowledge as infrastructure´. He suggests that a transformation process, such as introducing a new ERP system, will generate a learning process in the organization. This is a challenging task as this may constitute changed knowledge paradigms. Paradigm changes occur amongst employees in line with the organizations intention to change, while if the change is radical the new paradigm can be incompatible with past experiences of the individual (Hanseth, 2004).

The theory demonstrates the importance of the management´s awareness of the current socio- technical network and the competencies it withholds, then again ensure that the top-down decisions correlate with the current information infrastructure. The larger the change in paradigm, the harder it will be to implement successfully.

2.4.3 Measuring Digital Competence

“To interact with technology, people have to make sense of it; and in this sense-making process, they develop particular assumptions, expectations, and knowledge of the technology, which then serve to shape subsequent action toward it” (Orlikowski & Gash, 1994, p. 175).

Davenport and Prusak (1998) reflect this statement in their definition of knowledge;

“knowledge is a fluid mix of framed experiences, values, contextual information, and expert insight that provides a framework for evaluating and incorporating new experiences and information” (1998, p. 5). Therefore, while frameworks provide various structures for measuring the level of digital competence amongst individuals with relation to

conceptualizations, the results will depend on underlying factors identified by Davenport and Prusak.

Van Laar et al (2017, p. 586) argue that; “assessments allow us to determine to what extent employees have obtained the 21^st-century digital skills needed to enable them to be productive members of an information-rich and technology-based society”. Current research has focused on the average citizens, and the DigComp 2.1 framework is widely adopted. The

measurement method positions the test-taker into four dimensions; foundation, intermediate, advanced and highly specialized, where positions are met through a self-assessment tool. This method is highly criticized by other academic authors, based on individuals tendency to evaluate their competence to a greater extent than they actually are (Vieru et al., 2015; van

(25)

Laar et al., 2017; van Deursen & Mossberger, 2018), hence “self-report survey data has significant validity problems” (van Laar et al, 2018, p. 2190). Khan and Vuopala (2019) used the DigComp 2.1 framework to evaluate 197 individuals´ level of digital competence. The authors found that problem solving was the least developed competence according to the framework amongst the selected group. One must however consider that self-assessment was used, initiating a limitations in the result with regards to the appropriate level of competence.

Van Laar et al (2018) contributed to current research by constructing a measurement tool that avoids self-evaluation questions such as, ´how good are you at´ and ´how much do you agree´. Actual levels of employees´ level of digital competence is sought after.

A different method was applied by Kispeter (2018), who researched the links between job performance and an employee’s level of digital skills. The author found there to be limited empirical evidence that can generate an insight into the relationship. Kispeter (2018) did however find that the topic of digital competence is relatively absent in organizations, with the exception for the stage of employment. Van Laar et al (2018, p. 2184) argue that; “the rapid integration of new information communication technologies (ICTs) results in

continuously evolving digital skills necessary for employment and participation in society”.

Davenport and Prusak (1998) suggest that organizational success or failure depends on being aware of the knowledge you have and what you can and cannot do with that level of

knowledge. Vieru et al (2015) tested their framework through the lens of the multi-area conceptualization theory, and found that; “(...) it is virtually impossible that a single individual possesses al the required knowledge, skills and attitudes in all the competence domains” (Vieru et al., 2015, p. 4689). Essentially, the empirical findings contribute to identifying the importance of management making sure that there is a broad specter of

competencies within the workplace in order to fulfil all competence domains. A task that most commonly is adopted in the employment phase (Kispeter, 2018).

Figure 11: Motivational factors to improve an individual’s level of Digital Competence (Lloyds Bank, 2018, p.

25)

(26)

Figure 11 displays the findings from Lloyds Bank (2018) which reveals the underlying reasons for improving the level of digital competence. Individuals tend to increase their level of digital competence based on the motivation to improve performance and productivity at work. Interestingly, a quarter of the participants increases their level of digital competence for

´no particular reason´. Amongst the 2700 participants (from 18 years and up), a quarter cannot point to any motivational factors that drives the need to increase their levels of digital

competence. The report does not display any further explanation of the findings, then again there is a gap in our understanding of what influences a particular level of digital competence.

Davenport and Prusak (1998) suggest that the creation of knowledge in an organizational context is dependent on the employees and organizations continuous process of self-renewal.

It is therefore important to address the underlying factors that drive and cause particular levels of competence, hence gain a deeper understanding than ´no particular reason´.

2.5 Summary of Literature Review

The following table presents a short summary of the main findings of the literature review (table 7).

Themes discovered Presented 1. Definition and

terminology

14 terms that describes digital competence were identified. The terms presents digital competence in different context. Multiple definitions of digital competence were identified: the majority reflects a citizen perspective, and contains underlying concepts.

2. Frameworks 12 frameworks were identified:

the literature presents various frameworks (section 2.2 & 2.3).

3. Digital competence in the organizational context

3 main concerns: digital divide, dynamics of organizational learning and measuring digital competence.

Table 7: Summary of main findings from the Literature Review

There is a well-established call for further research on the topic of digital competence in an organizational context (Oberländer et al., 2020; van Laar et al., 2017; van Laar et al., 2018;

van Laar, van Derusen & van Dijk, 2019; Vieru et al., 2015; Murawski & Bick, 2017;

Bassellier, Reich & Benbasat; 2001). The literature review addressed the lack of an existing definition for this topic that does not regard particular underlying concepts. Furthermore, there are contradicting arguments for which underlying concepts that should be included when measuring digital competence. The literature review discovered themes that contributed to the data collection, analysis and discussion of the master thesis. Three main themes were retrieved; the digital divide, dynamics of organizational learning and measuring digital competence.

(27)

Chapter 3: Method

The following chapter will systematically explain the method that was chosen to answer the twofold research questions. The chosen research methodology will be presented with its strengths and weaknesses, subsequent with the underlying epistemology and type of research.

Presthus (2013) framework ´knowledge infrastructures in action´ will be introduces as a theoretical perspective. Further explanations will regard the data collection method, and the data analysis process will be discussed.

3.1 Case Study Research

A case study is a frequently used method when conducting qualitative research in

information systems (IS) research (Myers, 1997). Yin (1994) defines case studies as methods that; “(a) investigates a contemporary phenomenon within its real-life context, especially when (b) the boundaries between phenomenon and context are not clearly evident”.

Amaratunga et al (2002) suggest that a case study methodology is an appropriate research method when there is a real-life circumstance where the findings of current processes and behavior is limited. Furthermore, Oates (2006, p. 141) argues that the aim of a case study; “is to obtain a rich, detailed insight into the life of that case and its complex relationships and processes”. Case study research are often characterized by the intent to investigate ´how´,

´why´, ´who´, or ´what´ with respect to the chosen underlying philosophical assumption (Yin, 1989, Yin, 2014).

A case study is a respected research method (Dubé and Paré, 2003), characterized by the methodology’s strengths of combining multiple sources of evidence, such as observation, interviews, documents and physical artefacts (Yin, 2014; Walsham, 1995). A case study is argued to be appropriate when investigations consider particular complex phenomenon’s with an in-depth and holistic purpose (Dubé and Paré, 2003; Dubois and Gadde, 2002). On the other hand, the methodology lacks credibility with respect to generalization (Oates, 2006).

Furthermore, Easton (1995) extends the case study weaknesses; (1) essentially descriptions of events, (2) data provides, at best, partial support of a framework, (3) multiple case studies is argued to rely on statistical generalization (Easton, 1995, p. 379). In IS research, utilizing case study as a method is argued to establish an interpretive comprehension of interactions

between human and technology in a social setting (Orlikowski and Baroudi, 1991). There are three types of case studies, the exploratory, descriptive or explanatory research (Oates, 2006).

Oates (2006, p. 143) suggests that; “an explanatory study goes further than a descriptive study in trying to explain why events happen as they did or particular outcomes occur”. This case study is explanatory.

(28)

3.1.1 The boundaries and criteria of the case study

There are contradicting suggestions to the number of cases that should be included in case study research. Positivists, such as Yin and Eisenhard, argue that multiple cases included in a case study will generate more robust and generalizable findings, however their preferred number included in the case study varies (Dubois & Gadde, 2014). On the other hand, Langley (2009) and Dyer and Wilkins (1991) suggest that interpretations of a single case can generate rich insights into a particular context or phenomenon, which can display a powerful example. “When the problem is directed toward analysis of a number of interdependent variables in complex structures the natural choice would be to go deeper into one case instead of increasing the number of cases” (Dubois & Gadde, 2002, p. 558). This case study therefore aims to gain a rich and in-depth view of the phenomenon.

The following table provides an overview of how this study met Yins (2014) case study criteria (table 8).

Criteria for Case Study My Master Thesis

Phenomenon The need for digital competence amongst employees for organizational and personal purposes.

Complexity Lack of consistency in defining, framing and approaches to DC, training strategy, limited diverse use of technology, motivational challenges to increase DC from

organizational, management and employee perspective.

Real-world context Norwegian National Strategy for AI and unrealistic measures of current level of DC amongst employees.

Research questions (1) How does the Norwegian Banking Sector define digital competence?

(2) What are the underlying factors that determine the level of digital competence amongst employees?

Case Study Design Single case study of a complex phenomenon Case Study Type Explanatory

Source of evidence Secondary data, interviews and field trip (Table 10) Participants for research

questions

Interviews with employees at the case company,

background interviews and observation with Norsk Test and the management team of the case company

Table 8: Case Study Criteria (Yin, 2014)

(29)

I adopted Miles and Hubermans (1994) model with the aim of setting the boundary for the master thesis (figure 12). The literature review provides an overview of the broad scope digital competence extends to, and a challenge can occur when setting the boundary for topics that are relevant to include (Miles & Huberman, 1994). The following figure illustrates the Boundary of this master thesis, where the line indicates the scope of the research. Further discussion of the boundary will be made in section 3.4.2 regarding the sampling of data.

3.2 Ethical and Confidentiality Considerations

The nature of case studies drives a particular need for ethical considerations to do the likelihood of including human objects (Yin, 2014). This case study interprets a specific phenomenon in a single case study, and to ensure anonymity, the line of communication involved Norsk Test to be the mediator. The secondary data reflects anonyme scores of each employees level of digital competence, and it was important to the participants that took part in this case study to keep the management unaware of their identity. If the scores from test 1 and test 2 of each participant were revealed, it would be an uncomplicated process of

identifying the participant. The individuals´ scores from test 1 and 2 are therefore not included in this master thesis.

Norsk Test approached possible participants through email, and the participants were asked to contact me if they wanted to contribute to this master thesis. Participants did voluntarily reach out to me to schedule the interview. From that point on, I referred to the person as Participant 1-7 in transcripts and further analysis of their contributions. Each participant received an information sheet (appendix 9.4) in the initial email from Norsk Test, however I reminded them of their rights to withdraw at any point in time and right to be anonymous. Oral consents

Figure 12: Boundary and Focus of my case study (Miles & Huberman, 1994, p. 25)

(30)

were given from the participants. The majority of the participants allowed me to audio the interview, although these were deleted after the transcripts were made.

3.3 Theoretical Perspective

Current literature that has considered digital competence in an organizational context tends to draw on the previously mentioned frameworks as a lens for analysis. This master thesis aims to discover the possible growth of an organizations information infrastructure after

conducting efforts to increase digital competence. The theory on information infrastructure was introduced in section 2.4.2, with the emphasis on how organizational transformation processes are more than simply system implementation; it is a change in the infrastructure as a whole which causes learning processes (Hanseth, 2004). The author combined the theory of information infrastructure and knowledge management, then suggests three main insights:

knowledge as a network is both a structure and action. The employees exist in the same structure with the same resources, while their actions will differ (Hanseth, 2004). Following the network externality and increased return emphasize that the value of the network will increase with the number of participants that join (Shaprio & Varian, 1999). Lastly,

knowledge as infrastructure suggests that building a knowledge infrastructure takes time and resources (Presthus, 2013).

Presthus (2013) introduces the framework ´knowledge infrastructure in action´ (figure 13) as an extension of Hanseth´s (2004) theory on knowledge as infrastructure. The reproduced framework by Presthus (2013, p. 147); “(...) elaborates on the inner dynamics of the knowledge infrastructure”, then again focuses on the actions such infrastructures. While Presthus (2013) applied the theoretical framework in a schooling context, I will apply it in the banking sector.

Figure 13: Knowledge infrastructure in action (Presthus, 2013, p.148)

A Case Study on Digital Competence in the Norwegian Banking Sector

Master of Information Systems – Digital Business Systems